New Relic report reveals retailers are
increasing their observability investment to help reduce downtime
and time to incident resolution ahead of anticipated record-high
holiday season spending
New Relic (NYSE: NEWR), the all-in-one observability platform
for every engineer, announced the findings of its first State of
Observability for Retail report, which offers insight and analysis
on the adoption and business value of observability for the
retail/consumer industry. The report is based on insights derived
from 173 respondents in association with the 2023 Observability
Forecast report. Findings show that while tool fragmentation
persists, observability provides significant business value—many
reported $5 million in total value per year from their
observability investments, with a minimum 2x median annual return
on investment (ROI).
Today’s retailers face fierce competition and a difficult
macroeconomic environment, with the rapid increase in energy costs,
high inflation, growing interest rates, and supply chain
disruptions. Despite these challenges, U.S. online holiday sales
are expected to reach $221.8 billion (Nov. 1 to Dec. 31),
representing 4.8% growth YoY, compared with 3.5% YoY growth in
2022. In fact, Cyber Monday alone is expected to drive $12 billion
in spending, up 6.1% YoY.
With billions of dollars of consumer spending on the line, it is
critical for retailers and consumer-focused organizations to double
down on their digital customer experience (DCX) strategies and
focus on creating a seamless, omnichannel customer journey. To
create successful digital storefront experiences and keep customers
engaged, these companies are investing in observability tools that
give them visibility into their software across their often
complicated technology stacks.
“If a retailer’s website goes down for even 30 minutes on a
high-traffic day like Cyber Monday, it could cost them millions of
dollars, not to mention negatively influence their brand
perception,” said New Relic Chief Strategy and Design Officer
Peter Pezaris. “Implementing and maturing their observability
practice offers retailers a path to improve their DCX and achieve
omnichannel observability even during peak shopping seasons and
challenging macroeconomic headwinds.”
As retail, ecommerce, and other consumer organizations turn to
observability, the New Relic State of Observability for Retail
report reveals:
More Frequent Outages Lead to Higher Retail Observability
Spend
Outages leave retailers at risk for considerable downtime, which
can make a big impact during peak shopping seasons, like Black
Friday. Even still, the research shows retailers experienced
high-business-impact outages at a higher frequency than other
industries, with 37% reporting these outages at least once a week
compared to the average of 32%. In addition, more than half (55%)
of retail/consumer respondents noted it takes at least 30 minutes
to detect high-business-impact outages and 61% indicated it takes
at least 30 minutes to resolve them.
Notably higher than the annual outage cost across all other
industries, there’s a significant monetary impact from critical
business app outages, with respondents reporting a median annual
outage cost of $9.95 million. But, these organizations are
investing in their observability strategy. In fact, retailers
tended to spend more on observability than most other
industries—almost half (49%) said they spend $500,000 or more, and
31% said they spend $1 million or more per year on
observability.
The payoff is evident. Not only were many retailers able to
improve their mean time to resolution (MTTR), with 43% reporting
improvement since adopting an observability solution, but many also
realized a monetary benefit. More than half (57%) of respondents
noted more than $500,000 in total annual value, 43% said the total
annual value is $1 million or more, and 21% estimated they receive
$5 million or more per year in total value—and they aren’t slowing
down.
More Capabilities (Not More Tools) Leads to More
Context
Engineering teams are spending a significant amount of time and
money hopping between tools—with 69% of respondents toggling
between more than four observability tools—in an effort to
understand the different aspects of their business. This slows down
engineers, making it take longer to find outages, which leads to
higher outage costs and poor customer experiences.
Looking to avoid considerable, costly outages and increase
productivity, the research indicated retailers are moving toward
tool consolidation. Nearly half (42%) of respondents said their
organization is likely to consolidate tools in the next year to get
the most value out of their observability spend and the prevailing
preference among retail and consumer respondents is for a single,
consolidated platform (46%).
In addition to moving from a point solution to a platform
approach, the report indicates retailers and other consumer
organizations are continuing to expand their observability practice
by adding new capabilities. In fact, the research found that:
- By mid-2026, most (98%) are expected to have deployed alerts,
followed by network monitoring and security monitoring (both
97%).
- In the next one to three years, more than half (53%) are
expected to deploy synthetic monitoring, 42% are expected to deploy
mobile monitoring, and 39% are expected to deploy browser
monitoring.
- By mid-2026, 90% expected to have deployed browser monitoring,
85% expected to have deployed mobile monitoring, and 79% expected
to have deployed synthetic monitoring.
For more information, view the free State of Observability for
Retail report today.
About New Relic
As a leader in observability, New Relic empowers engineers with
a data-driven approach to planning, building, deploying, and
running great software. New Relic delivers the only unified data
platform that empowers engineers to get all telemetry—metrics,
events, logs, and traces—paired with powerful full stack analysis
tools to help engineers do their best work with data, not opinions.
Delivered through the industry’s first usage-based consumption
pricing that’s intuitive and predictable, New Relic gives engineers
more value for the money by helping improve planning cycle times,
change failure rates, release frequency, and mean time to
resolution. This helps the world’s leading brands including adidas
Runtastic, American Red Cross, Australia Post, Banco Inter, Chegg,
GoTo Group, Ryanair, Sainsbury’s, Signify Health, TopGolf, and
World Fuel Services (WFS) improve uptime, reliability, and
operational efficiency to deliver exceptional customer experiences
that fuel innovation and growth. www.newrelic.com.
Forward-looking statements
This press release contains “forward-looking” statements, as
that term is defined under the federal securities laws, including
but not limited to statements regarding anticipated trends and
benefits related to observability and our products, and expected
business impacts related thereto. The achievement or success of the
matters covered by such forward-looking statements are based on New
Relic’s current assumptions, expectations, and beliefs and are
subject to substantial risks, uncertainties, assumptions, and
changes in circumstances that may cause New Relic’s actual results,
performance, or achievements to differ materially from those
expressed or implied in any forward-looking statement. Further
information on factors that could affect New Relic’s financial and
other results and the forward-looking statements in this press
release is included in the filings New Relic makes with the SEC
from time to time, including in New Relic’s most recent Form 10-Q,
particularly under the captions “Risk Factors” and “Management’s
Discussion and Analysis of Financial Condition and Results of
Operations.” Copies of these documents may be obtained by visiting
New Relic’s Investor Relations website at http://ir.newrelic.com or
the SEC's website at www.sec.gov. New Relic assumes no obligation
and does not intend to update these forward-looking statements,
except as required by law.
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version on businesswire.com: https://www.businesswire.com/news/home/20231025734817/en/
Elena Keamy New Relic, Inc. PR@newrelic.com
Investor Contact Ingo Friedrichowitz New Relic, Inc.
503-336-9280 IR@newrelic.com
New Relic (NYSE:NEWR)
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